Scientific Method —

Economists demonstrate exactly why bank robbery is a bad idea

The typical return on a bank holdup is, "frankly, rubbish."

In most papers we at Ars cover, we'll be pleasantly surprised to find a single clever turn of phrase that has survived multiple rounds of editing and peer review. So it was an unexpected surprise to come across a paper where the authors, all professors of economics, have spent the entire text with tongues so firmly planted in their cheeks that they threatened to burst out, alien-style. It surprised me even more to find it in a journal that is produced on behalf of the Royal Statistical Society and American Statistical Association. Credit to the statisticians, though, for the journal's clever name: Significance.

What topic allowed the economists to cut loose? Bank robberies—or more specifically, the finances thereof. The UK's banking trade organization decided it wanted an analysis of the economic effectiveness of adding security measures to bank branches. The professors did that, but in the process, they also did an analysis that looked at the economics of bank robbery from the thieves' perspective.

The results were not pretty. For guidance on the appropriateness of knocking over a bank, the authors first suggest that a would-be robber might check with a vicar or police officer, but "[f]or the statistics, look no further. We can help. We can tell you exactly why robbing banks is a bad idea."

The basic problem is the average haul from a bank job: for the three-year period, it was only £20,330.50 (~$31,613). And it gets worse, as the average robbery involved 1.6 thieves. So the authors conclude, "The return on an average bank robbery is, frankly, rubbish. It is not unimaginable wealth. It is a very modest £12,706.60 per person per raid."

"Given that the average UK wage for those in full-time employment is around £26,000, it will give him a modest life-style for no more than 6 months," the authors note. If a robber keeps hitting banks at a rate sufficient to maintain that modest lifestyle, by a year and a half into their career, odds are better than not they'll have been caught. "As a profitable occupation, bank robbery leaves a lot to be desired."

Worse still, the success of a robbery was a bit like winning the lottery, as the standard deviation on the £20,330.50 was £53,510.20. That means some robbers did far better than average, but it also means that fully a third of robberies failed entirely.

(If, at this point, you're thinking that the UK is just a poor location for the bank robbery industry, think again, as the authors use FBI figures to determine that the average heist in the States only nets $4,330.00.)

There are ways to increase your chance of getting a larger haul. "Every extra member of the gang raises the expected value of the robbery proceeds by £9,033.20, on average and other things being equal," the authors note. Brandishing some sort of firearm adds another £10 300.50, "again on average and other things being equal."

What do the numbers mean to the group that actually asked for the study, the bankers? For one, the pattern of branches targeted for robberies appeared more or less random, with branch size, distance to the nearest police station, etc. all failing to influence the frequency of robberies. So the banks probably can't focus their security costs on any subset of their branches that are more likely to be victimized.

One security measure that has been adopted in the UK—bank tellers can trigger compressed air to rocket a security screen up, separating them from the robbers—is remarkably effective: "A fast-rising screen in a banking outlet relative to other counter-security arrangements reduces the expected value of a robbery by £24,463.30, on average and other things being equal." You may be confused by the fact that this is more than the average haul, but the authors are prepared for your conclusion, noting parenthetically, "Those last seven words take care of the fact that the expected reduction in haul is £4,000 greater than the expected average haul. A screen in no case has actually resulted in raiders handing over £4,000 of their own money to the bank cashiers before fleeing the premises."

Despite the effectiveness of these screens, however, the low rate of robberies and their general failure to remove much in the way of cash from the banks means that it's probably not worth the cost of installing them.

So, there you have it: a clear case where crime, economically, doesn't pay. The authors suspect this may be behind the gradual decrease of bank robberies in the UK. "It is worth noting that the criminals themselves seem to have learnt this," they conclude. "Robbing banks is no longer what you could call the crime of choice."

Possibly so, but it's probably a stretch to go from that to their final conclusion: "The lesson of which would seem to be: successful criminals study econometrics. Statistics can help in all walks of life."

Possibly so, but it's probably a stretch to go from that to their final conclusion: "The lesson of which would seem to be: successful criminals study econometrics. Statistics can help in all walks of life."

Probably a lot to do with more transactions being done electronically and banks therefore holding less cash on site. That's life in the 21st century for you. 25 years ago young villains were getting out and about robbing banks and mugging old ladies. Nowadays they're better off just staying at home and writing malware.

Possibly so, but it's probably a stretch to go from that to their final conclusion: "The lesson of which would seem to be: successful criminals study econometrics. Statistics can help in all walks of life."

Ok, so... which method of crime is statistically the most profitable?

The kind that you get reclassified as legal. See the financial industry's behavior over the last ~12 years.

Bars, liquor stores, gas stations, you get your head blown off stickin' up one of them. Restaurants, on the other hand, you catch with their pants down. They're not expecting to get robbed, or not as expecting.

Bars, liquor stores, gas stations, you get your head blown off stickin' up one of them. Restaurants, on the other hand, you catch with their pants down. They're not expecting to get robbed, or not as expecting.

Yeah, I would have to say that a resaurant is a good place to rob. Especially locally owned/SBA types. They tend to skimp on things security being one of them. They are also usually short staffed, so they do not make as frequent deposits to thier banks. I think stealing anything you are probably doomed to get caught eventually, but small restaurants would be the way to go.

Sure the cost/risk as a salary replacement is too high, but compared to my bonus...

That was my thinking going into the second paragraph. Wasn't until I got to the part where the average haul in the US was $4k that I reconsidered. I always thought the average haul in bank robberies was more in-line with what the statisticians found in the UK.

I never thought of bank robbers (at least the majority of them) as being career bank robbers, especially since the Recession hit in '08. If I was suddenly jobless and poor and needed money, a 30-second bank robbery yielding $20-$30k would put a shit-ton of food on the table for a while, at least until I got a job. At the very least it would keep the debt collectors at bay. But $4k isn't and wouldn't be worth it. That wouldn't even cover my monthly living expenses.

Bars, liquor stores, gas stations, you get your head blown off stickin' up one of them. Restaurants, on the other hand, you catch with their pants down. They're not expecting to get robbed, or not as expecting.

Bars, liquor stores, gas stations, you get your head blown off stickin' up one of them. Restaurants, on the other hand, you catch with their pants down. They're not expecting to get robbed, or not as expecting.

Bravo, sir.

"If any one of you fucking moves, I'll execute every last one of you!!!"

Bars, liquor stores, gas stations, you get your head blown off stickin' up one of them. Restaurants, on the other hand, you catch with their pants down. They're not expecting to get robbed, or not as expecting.

I would be surprised if there was very much cash at a decent restaurant. Seems to me that most people pay by credit card.

I was on the jury for a bank robbery case in Reno, NV. The guy held up the bank, grabbed a cab, and had the cabbie take him to a casino. Where the police nabbed him because he had the bundle of cash with the radio tracker in it.

Bars, liquor stores, gas stations, you get your head blown off stickin' up one of them. Restaurants, on the other hand, you catch with their pants down. They're not expecting to get robbed, or not as expecting.

Utility companies (water, electric, cable, phone, Internet) also have a lot of cash and are frequent targets. I didn't even know you could pay a utility bill with cash, in person, but apparently a lot of people do. A cable company in a poor urban area is probably raking in currency like no one else.

Unfortunately, I know that because the last time I was in a Comcast store I was stunned by the level of security, so it is probably hard to pull off: (cop parked outside, full time guard inside, counter-to-ceiling bullet proof plexiglass -- they even had those special box things for passing things across the counter, the ones that can only be opened from one side at a time).

Bars, liquor stores, gas stations, you get your head blown off stickin' up one of them. Restaurants, on the other hand, you catch with their pants down. They're not expecting to get robbed, or not as expecting.

The downside is that nobody pays cash at restaurants anymore, unless you're talking about holding up the local Micky-Ds.

Possibly so, but it's probably a stretch to go from that to their final conclusion: "The lesson of which would seem to be: successful criminals study econometrics. Statistics can help in all walks of life."

I remember reading many years ago (see: the 90's) that the chances of being caught were less than a tenth of a bank heist and the haul was generally ten times as big. These days it's lots of little hits organized out of third world countries

Bars, liquor stores, gas stations, you get your head blown off stickin' up one of them. Restaurants, on the other hand, you catch with their pants down. They're not expecting to get robbed, or not as expecting.

The downside is that nobody pays cash at restaurants anymore, unless you're talking about holding up the local Micky-Ds.

Depends on where you live. Try using a credit card/debit card in Downtown San Francisco. I know it seems crazy, but the amount of cash-only restaurants Downtown is staggering for the Financial Capital of the West Coast.

Bars, liquor stores, gas stations, you get your head blown off stickin' up one of them. Restaurants, on the other hand, you catch with their pants down. They're not expecting to get robbed, or not as expecting.

I would be surprised if there was very much cash at a decent restaurant. Seems to me that most people pay by credit card.

ps. I do get the joke from PF, just making a point.

The fancier the restaurant, the less cash there is in the drawer; but the more money there is when you steal all the wallets. The cheaper the restaurant, the more cash there is in the drawer; but the less money there is when you steal all the wallets.

You need to figure out where those line intersect and rob, I don't know, a Perkins or something.

Bank wants to do study to see which security measures they should implement. Researchers figure out that the cost/benefit of implementing more security is so low it's just not worth it? Is that the moral here?

I take it, as economists, they didn't factor in the "cost/value" of someone potentially being shot/injured/killed. Oh, but that can have a price tag put on it, too, just ask an insurance company.

I see the idea of the cost/benefit, but the idea of prevention is not just to prevent money from being stolen, but prevent your customers and employees from being injured or killed in a high-target business.

Bars, liquor stores, gas stations, you get your head blown off stickin' up one of them. Restaurants, on the other hand, you catch with their pants down. They're not expecting to get robbed, or not as expecting.

I would be surprised if there was very much cash at a decent restaurant. Seems to me that most people pay by credit card.

ps. I do get the joke from PF, just making a point.

The fancier the restaurant, the less cash there is in the drawer; but the more money there is when you steal all the wallets. The cheaper the restaurant, the more cash there is in the drawer; but the less money there is when you steal all the wallets.

You need to figure out where those line intersect and rob, I don't know, a Perkins or something.

A wallet sweep seems like a bad idea. You need to threaten so many people, some of whom may be somewhat deranged and armed, and even if not, it still takes a long time to go around threatening everybody, lots of time the cops can use to surround the restaurant after that guy in the booth in back called 911 on his cell.

In short two problems:1. You get a wallet that reads: Bad Mother Fucker2. Takes way too long.

Bars, liquor stores, gas stations, you get your head blown off stickin' up one of them. Restaurants, on the other hand, you catch with their pants down. They're not expecting to get robbed, or not as expecting.

Utility companies (water, electric, cable, phone, Internet) also have a lot of cash and are frequent targets. I didn't even know you could pay a utility bill with cash, in person, but apparently a lot of people do. A cable company in a poor urban area is probably raking in currency like no one else.

Unfortunately, I know that because the last time I was in a Comcast store I was stunned by the level of security, so it is probably hard to pull off: (cop parked outside, full time guard inside, counter-to-ceiling bullet proof plexiglass -- they even had those special box things for passing things across the counter, the ones that can only be opened from one side at a time).

Good point, but since I think a lot of comcast customers probably just want to shoot someone, it isn't the best example.

Possibly so, but it's probably a stretch to go from that to their final conclusion: "The lesson of which would seem to be: successful criminals study econometrics. Statistics can help in all walks of life."

I remember reading many years ago (see: the 90's) that the chances of being caught were less than a tenth of a bank heist and the haul was generally ten times as big. These days it's lots of little hits organized out of third world countries

Like our Nigerian "friends" who keep yelling at me to be an intermediary and to give them my bank account number so they can transfer their millions of $$ into it??

Two things about these findings: You don't really need statistics to know whether installing screens is valuable, you can simply check how much of an insurance benefit you'll get from installing the screens. Insurance companies already do a lot of this statistical work; no need to do the work again, they'll tell you the answer in the price that they quote you. There's an enormous amount of information in the insurance market if you're willing to look.

Second; I don't agree with the author's conclusion that it's crazy to rob banks. If the distribution is bimodal--they get close to nothing or get a lot--and it's entirely conceivable to think that getting caught may not be that much worse than not getting caught and starving (or failing to feed an addiction), then it may be reasonable to make the attempt to rod the bank.

It struck me as suspicious that they were using a mean on a set of values with a very high standard deviation. That's usually a sign of someone trying to play the numbers, and we even saw it break down when they start talking about the air jet screens.

This is especially true when they start talking about wage comparisons, when really an actual successful robbery will be worth considerably more than the mean (which was dragged down by a large number of 0s from robbers that were caught).

Still, the relatively high probability of failure for each robbery makes it too risky for a long term career option, even if you can live for a year and a half (not 6 months as indicated by the article) from the haul. I suspect that most people who rob banks tend to blow the money on frivolous items relatively quickly too instead of managing it smartly. The difficulty in managing the money doesn't help that either--people ask questions when you walk in with a huge pile of cash.

It's pretty easy to rob a bank if you run it, and you don't even go to prison if you get caught. Take Countrywide. Andrew Mozilo managed extract nearly $400 million over five years from the bank he ran, ostensibly as compensation for the fabulous company results. Never mind that what he actually did was encourage fraudulent loans to maximize profits and his compensation, while driving the bank into the ground. The bank went bust, but he kept most of that money, with just a $60M slap on the wrist from a civil lawsuit.

Bars, liquor stores, gas stations, you get your head blown off stickin' up one of them. Restaurants, on the other hand, you catch with their pants down. They're not expecting to get robbed, or not as expecting.

Except this is in the UK. If they shoot at you when you're robbing them, THEY go to prison. lol

Bank wants to do study to see which security measures they should implement. Researchers figure out that the cost/benefit of implementing more security is so low it's just not worth it? Is that the moral here?

I take it, as economists, they didn't factor in the "cost/value" of someone potentially being shot/injured/killed. Oh, but that can have a price tag put on it, too, just ask an insurance company.

I see the idea of the cost/benefit, but the idea of prevention is not just to prevent money from being stolen, but prevent your customers and employees from being injured or killed in a high-target business.

You also need to factor in, customers getting killed due to security. If the screens pop up (and no customers get their arms chopped off), you get a very angry person with a gun in a room with a bunch of your customers. (Note: This is not good.)

Your best bet is to give the robber what they want, as well as, a die pack and a radio transmitter. Next, you use the outside video to show the robbers car and you put his or her face on the local news. It also does not hurt to have a few off duty cops standing around waiting to shoot someone.

Possibly so, but it's probably a stretch to go from that to their final conclusion: "The lesson of which would seem to be: successful criminals study econometrics. Statistics can help in all walks of life."